Ron Paul Asks Of The Fed: "When Will This Madness Stop?"

Last week, Federal Reserve Chairman Janet Yellen testified before Congress for the first time since replacing Ben Bernanke at the beginning of the month. Her testimony confirmed what many of us suspected, that interventionist Keynesian policies at the Federal Reserve are well-entrenched and far from over. Mrs. Yellen practically bent over backwards to reassure Wall Street that the Fed would continue its accommodative monetary policy well into any new economic recovery. The same monetary policy that got us into this mess will remain in place until the next crisis hits.

Isn't it amazing that the same people who failed to see the real estate bubble developing, the same people who were so confident about economic recovery that they were talking about “green shoots” five years ago, the same people who have presided over the continued destruction of the dollar's purchasing power never suffer any repercussions for the failures they have caused? They treat the people of the United States as though we were pawns in a giant chess game, one in which they always win and we the people always lose. No matter how badly they fail, they always get a blank check to do more of the same.

It is about time that the power brokers in Washington paid attention to what the Austrian economists have been saying for decades. Our economic crises are caused by central bank infusions of easy money into the banking system. This easy money distorts the structure of production and results in malinvested resources, an allocation of resources into economic bubbles and away from sectors that actually serve consumers' needs. The only true solution to these burst bubbles is to allow the malinvested resources to be liquidated and put to use in other areas. Yet the Federal Reserve's solution has always been to pump more money and credit into the financial system in order to keep the boom period going, and Mrs. Yellen's proposals are no exception.

Every time the Fed engages in this loose monetary policy, it just sows the seeds for the next crisis, making the next crash even worse. Look at charts of the federal funds rate to see how the Fed has had to lower interest rates further and longer with each successive crisis. From six percent, to three percent, to one percent, and now the Fed is at zero. Some Keynesian economists have even urged central banks to drop interest rates below zero, which would mean charging people to keep money in bank accounts.

Chairman Yellen understands how ludicrous negative interest rates are, and she said as much in her question and answer period last week. But that zero lower rate means the Fed has had to resort to unusual and extraordinary measures: quantitative easing. As a result, the Fed now sits on a balance sheet equivalent to nearly 25 percent of US GDP, and is committing to continuing to purchase tens of billions more dollars of assets each month.

When will this madness stop? Sound economic growth is based on savings and investment, deferring consumption today in order to consume more in the future. Everything the Fed is doing is exactly the opposite, engaging in short-sighted policies in an attempt to spur consumption today, which will lead to a depletion of capital, a crippling of the economy, and the impoverishment of future generations. We owe it not only to ourselves, but to our children and our grandchildren, to rein in the Federal Reserve and end once and for all its misguided and destructive monetary policy.

The Fed's power lies in the hands of Congress who could abolish it. They won't because of the power it brings to them and this is especially true since we were taken off the gold standard since they have no constrictions on spending. This may be an unpopular opinion but I think the politicians are even more evil than the Fed for this reason.

Allowed to speak on TV? He was IGNORED during the 2012 election. They wouldn't even say his name at the GOP convention. Are you ignorant, or just a statist scum? Every time his name is mentioned on TV, it is in ridicule. He ran as a republican because that is the only way to be in the conversation at all. He is closer to a libertarian and he loves the Constitution. Just look at his recored. You are a piece of shit to mix his name in with the rest of the dems and RINOs.

I mean - look at the fuckin state of affairs? Ive been on this planet long enough to know that we are being fuckin lied to every fucking day with no change... NO FUCKIN CHANGE. He is a brethren of the craft - do you understand?

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I have the right to scrutinize and be suspicious all those mofo's. You guys can keep licking his nuts - at least we have the bases covered...ill be that 1.

So what if he's a freemason? The way you word it, it sounds like he's been boinking model beta kittens a la Eyes Wide Shut. There are lots of low-level freemasons who have no idea what sort of silliness they are part of, and are more the pillar of the community types. OHHH BRETHREN OF THE CRAFT DAMN HE IS SUMMONING CTHULHU

Blotto, you are engaging in classic messenger blaiming. If a doctor makes a mistake, does that mean all doctors are idiots? Of course not. There ARE decent politicians. To think otherwise is to miss the nuances in life and resign to a black/white, rich/poor, Rep/Dem dichotomy of hopelessness.

"We're now in the midst of unlimited spending of the people's money, exorbitant taxation, deficits of trillions of dollars--spent on a failed welfare/warfare state; an epidemic of cronyism; unlimited supplies of paper money equated with wealth.

A central bank that deliberately destroys the value of the currency in secrecy, without restraint, without nary a whimper. Yet, cheered on by the pseudo-capitalists of Wall Street, the military industrial complex, and Detroit." - May 19th, 2009 - Speech on House Floor

I personally feel that he did try and raise awareness to this BS but no one listened.

If one is to assume that Paul is contrived opposition then your points only serve to further that assumption in terms of building his legend and street cred with those he is to pied piper away. Hopium is hopium whether it be a Paul or Obama. Personally it always felt that as bright as rp is he is always playing checkers when he should be playing chess

not at all... it is silliness like that which discredits your points... i am comparing the delusion that you should put your hope into a mortal human to achieve for you what you are responsible for... i see no difference in this regard between paul supporters and obama supporters.... the messages are quite different but the means are the same

Are you daft? The means to Obama's end is to sit on your ass and give government all the power. The means to Ron Paul's end is to take responsibility for yourself and to reject any growth in government power. Sure, Ron Paul had a following, but he was a horrible speaker and women were certainly not fawning over him. He won them over with the content of his message and NOT his personality. Obama's message of hope and change had no substance and was taken at face value. Obama is completely superficial. Try not to confuse the two.

so why need a ron paul or an obama? this is what you are missing... you think i am anti paul but only because i disagree with trusting him (like blotto)... i can like the ideals but don't believe paul can accomplish them purely though acts of office... even if he got into office, history argues for him to take a pragmatic approach at the point. ppl like blotto and i refuse to be part of the cult of personality or take part in the delusional and wishfull thinking that is associate with belief that any human is your savior

you can see hundreds of videos of him doing just that on youtube, dumbass. try looking before you say things like that. and as for him getting censored or being allowed on tv, here is a nice compellation of him just being ignored by the media. obviously it worked on you, since here you are spouting this kind of ignorance

“Why are we taking precious military and intelligence resources away from tracking down those who did attack the United States–and who may again attack the United States–and using them to invade countries that have not attacked the United States? 22.” (Ron Paul Speaks, fn. 22 Ron Paul, "Questions That Won’t Be Asked About Iraq," U.S. House of Representatives, Sept. 10, 2002.)

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Therefore, he does not think its an inside job...he thinks its Al-Qaeda or whatever.

You are a piece of shit becuase you are misrepresenting Paul and you are accusing him of being part of the Red-Blue team when his record speaks to the contrary. You can be suspecicious, but I would suggest keeping opinions to yourself until you do more research and can back them up.

"However, on the global stage, they dont let decent politicians ever get close to being a threat to their agenda."

Ron Paul was never much of a threat. His MESSAGE is a big threat even today.

"And lordylord - anyone thats been on here for less than 4 weeks - has no fucking clue what im about or any other longtime loyal ZeroHeds for that matter."

Facts are facts and your bullshit is bullshit. I don't care if am only a member for a day. I called you out on your comment posted today. I don't need your history.

"Yea, love the vids...I just seen a great one of RAND Paul endorsing Mitt Romney..."

Rand Paul and Ron Paul are two different people. We were talking about Ron. Confused?

"Whats Ron Paul's stance on 9/11?"

What happened on 9/11 and what can be proven are two different things. Should Ron Paul be screaming "inside job" or should he bring attention to the US Foreign Policy? I think the latter is more productive. Let someone else prove 9/11 was an inside job.

"Yea, love the vids...I just seen a great one of RAND Paul endorsing Mitt Romney..."

Rand Paul and Ron Paul are two different people. We were talking about Ron. Confused?

"Whats Ron Paul's stance on 9/11?"

What happened on 9/11 and what can be proven are two different things. Should Ron Paul be screaming "inside job" or should he bring attention to the US Foreign Policy? I think the latter is more productive. Let someone else prove 9/11 was an inside job.

Let someone else prove 9/11 was an inside job.

Let someone else prove 9/11 was an inside job.

Let someone else prove 9/11 was an inside job.

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What does that have to do with what Ron Paul said in HIS BOOK regarding 9/11? 'Let someone else prove...' has nothing to do with the most important point - HE THINKS IT WAS NOT AN INSIDE JOB.

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Now, go back to bed...and follow your own advice regarding research so you wont get fooled again...

Can you please show me the conclusive evidence that 9/11 was an inside job. The book was about US foreign policy. Not 9/11. I'm sorry that facts and reality are getting in your way today. I also noticed that nothing in your incoherant response rebutted anything I said.

let me preface this by saying this is pure speculation on my part, but I think he probably keeps his mouth shut about that becuase that would be all that is needed to turn a huge segment of the population that would be willing to listen to his message against him, and make them think of him as a crackpot. That is already the main way mainstream media and politicians use to descredit him. Every single true statement and good point made would be answered with "ya but he thinks the govt was responsble for 9/11, so any talk of ending the fed is the talk of wing nut conspiracy theorists" 9/11 stuff would just move the topic off his main message- sound money, freedom, etc. and RON and RAND are two very different people. I personally wish ron would take his boy out behind the wood shed and beat some liberty into him, but oh well.

If you want some very eye opening information on the Fed please read Eustace Mullins' "Secrets of the Fed". Mullins was undoubtedly the authority on the shadowy organization and his 40+ year research and documentation shows it. It dispels a ton of myths and gives a clear picture of who is who. In fact it is the only book ever burned in Germany since WWII. A protégé of Ezra Pound and a colleague of George Stimpson it's defiantly worth a look. http://www.barefootsworld.net/fedsecrets_00.html

When? That's easy, when it's their name on the title to every single physical asset and resource on the planet. The robber barrons have always been here, we simply need to keep culling their numbers from time to time...

Bullshit, that which cannot be sustained, won't be, period. And then what? Well, for starters people will have to actually start working for a living again (not simply pushing bullshit pieces of paper around).

"No matter how badly they fail, they always get a blank check to do more of the same."They are not failing, they are succeeding in their plans. They make/write the checks.

"Yet the Federal Reserve's solution has always been to pump more money and credit into the financial system in order to keep the boom period going, and Mrs. Yellen's proposals are no exception."Of course they pump more "money" into the system. This "money" is debt we owe to them. RP knows this. If you had the privilege to print YOU-OWE-MEs, what would you do?

"Every time the Fed engages in this loose monetary policy, it just sows the seeds for the next crisis, making the next crash even worse."The Fed owners/masters want it all. The crises are their goals.

"As a result, the Fed now sits on a balance sheet equivalent to nearly 25 percent of US GDP, and is committing to continuing to purchase tens of billions more dollars of assets each month."It wants 100% of GDP (or more). Then they just own everything and all the people are serfs.

"Everything the Fed is doing is exactly the opposite, engaging in short-sighted policies in an attempt to spur consumption today, which will lead to a depletion of capital, a crippling of the economy, and the impoverishment of future generations."Everything they are doing is the opposite of good for everyone but them. Their policies are only short-sighted to everyone but them. These short-sighted policies are baby steps to long-term goals. They need us to consume, so we need more money from them. The only this they care about is: the impoverishment of future generations.

This is a longwinded article to just say: the Fed wants it all and they will get it. RP should not event have used "money" is this, he should have just called it indentured servitude...but perpetual.

RP knows better, the Fed is not going to stop because at this point it can't. Main Street has long since been sacrificed by the Fed and gov't for the sake of Wall Street. All of their eggs are in one basket.

If they stop, instant crash, with horrible consequences, with morons like schumer demanding that the fed 'get to work' and the people demanding govt 'do something' since to the brain dead sheep of America, the solution to a problem created by the fed and the govt, is more fed/gov intervention. If they keep printing, there will be a crash eventually with a rejection of the dollar, but we only care about the here and now, and our leaders only care about the next election cycle. So the easiest thing to do since we only care about short term is to keep printing.

Oh Ron Paul, how I truly miss your honesty and idealism. But this shit has been going on seemingly forever and after your 30 or so years railing about it on congressional record, even though waking up more than a few, has not even put up even the smallest of roadblocks to stop this insanity. Just in the past decade alone, we have blatantly seen how far these schemes will go to push the boundaries of surrealness, yet it continues to get worse exponetially. Kinda hard to be a lone voice in the wilderness when it seems the wilderness around you is growing faster than the speed of sound.

I finally had the chance to speak out in the lobby of a BOA. The bank lady tried to tell a nice old lady she should put all her savings into a CD....I stopped her right there and told her to close her accounts and put money under mattress. ......people in line were shocked. ......strangely, or perhaps not, the old lady knew the truth and was in complete agreement !!!

Last time I went to my bank, a manager tried to offer me a savings account. I told her that it didn't keep up with inflation and there was no point. She agreed and the sad look in her eyes told me she was tired of "scamming" people.

Out there in the vast ignorance of the world it festers and spreads. A shadow that grows in the dark. A sleepless malice as black as the on coming wall of night. So it ever was, so will it always be. IN TIME ALL FOUL THINGS COME FORTH.

Big government is only possible with Keynesian economic policies and central planning. For that reason, the madness will never stop until it falls apart spontaneously. Governments do so much bad in comparison to any "good" they do. If you voted for Obama or Romney, go fuck yourself. You are just as responsible for the atrocities government commits every day.

Since Ron Paul is near the end of his life and no longer a factor in the government maybe he should end his life by blowing up the Fed or at least killing Janet Yellen. Being Ron Paul he might be one of the only people who can geg close enough to do it.

In fact any Senator or Congressman with enough love of this country should do the same. Wear a bomb to the chamber and kill as many of these treasonous bastards as possible.

Nothing will change until the streets of Washinton run red with central government blood.

there you go again testifying to the moral character of paul as if it is known fact and the you share minds and hearts with the man.... to clarify, the message paul has had is not the issue but by making this into an issue of moral character then you are just reenforcing the same cult of personality bs that has surrounded obama and other galvanizing figures selected to spearhead social trends

The media, fellow Republicans, and a few of his own comments have turned the perception of Ron Paul into a 'kook'. Had he stayed in Congress he would still have had some real power within the committees, but now that he is outside of Congress his message will only be reaching his followers. The liberal media certainly is not going to interview him or run any stories where he is quoted. Our best hope is that we get a Republican sweep in 2016 and can appoint Ron Paul as chairman of the Federal Reserve -- to oversee it's audit and dismantling...

Ron Paul "disconnected" himself. Sometimes it shows more integrity to walk out than to allow political enemies make a martyr of you. The powers of both Parties were arrayed against him. And he is old. (Yes, it would be nice if Ron were a young loud-mouth firebrand at the beginning of his career, but he's not -- and I'm not pinning much hope on his son.)

Why do ignore that Paul quit when he was at a point that he could actually make an impact? That is nothing to
respect, nor is quitting an act to ass/u/me better things will come of the person in the future.

You must be high if you think the Rep establishment would ever appoint Ron Paul to anything.

They wouldn't even give him commitee chair that we was due.

If you think a Replublican electoral victory will change anything, you have not been paying attention. When that so-called "small government" party took the House a few years ago, their first order of business was to pass the largest budget in the history of the world. And, now they've submitted to eliinating the debt ceiling. Budget deficits will continue grow and the Fed is just about the only buyer left.

So, at every turn where the Republicans could have held this check, they have failed to do so.

I tend to agree though you know this is an unpopular opinion. I watched many of the meetings with Bernanke and though he certainly made it known his opposition, he also demonstrated his weakness by not demanding Bernanke stop printing. I would have had a hard time not wanting to beat Bernanke over the head with a baseball bat for instance and Ron was not going there.

Quitting is a character defect. Even more so Paul is supposedly so passionate on the subject that he quits when he finally achieved prominence and leadership of a committee for him to do something.

Yes, mine is an unpopular position on this website, but should it be? First and foremost we should show respect
for those that have the American backbone and will to achieve - not to those that are idealistic talkers who are quitters.

Threatend him with what? Another subpoena? or just a lot of tough talk. In either case, the money printing will continue.

In fact, maybe the better strategy is not to offer a solution, but to make sure everyone sees who's fault this really is. The outcome is inevitibale and a congress full of Ron Pauls probably couldn't stop it. But you can be sure that if he was in charge when the SHTF, liberatarian and free market ideas would take the wrap.

I say if the ship is going to crash let the oligarchs who caused it be at the helm, and make sure everyone knows.

The media’s 100 years of the crescendoing Greenspan maestro image of the Fed is dead; the Fed's reputation is “pushing up the daisies,” buried alongside US 666, the economic highway to Hell strewn with slides of derivative rubble, busted dotcom, equity, and housing boulders, and impoverished savers begging for a handout.

In case you’ve forgotten, here’s the way it was back in 2003 at the height of Greenspan’s maestro fame – before the Fed's denouement.

Pop! Goes the Housing: That's the Way the Money Goes

- a parody by Sandy HannaI'm riding on a bubble--a housing bubble! Every day it gets bigger, and thinner.

"Whee-e-e-e!!! Isn't this fun, kid?" pants Daddy, as he pushes down hard on the interest rate and pumps up the money supply bigger and bigger, and the housing bubble gets thinner, and thinner.

I'm a little scared, but Daddy says just to hold on "cause this bubble's gonna be the biggest of them all. "When this one pops, he says, it could pop those homeowners right off their sofas, right into the streets. Thousands of 'em!

Daddy is famous for bubbles. One blew up the stock market and all the401(k)s in it and scattered trillions to the winds! Just three years ago.Another, a "smart" bubble, blew out the value of the dollar and wiped out lots of dusty old things like stingy old ladies' savings accounts and put the profitsin the accounts of the bankers who help people.

My daddy operates the big bankers’ money machine.They call it “The System” (you know, for Federal Reserve System)!It makes money!Out of air! And it destroys money.With a big suck!It's a big secret how Daddy does it, and he says not to talk cause what he does isunconstitooshunal. He won’t even tell people like Congressman Ron Paul who keeps trying to find out!

This makes Dr. Paul upset cause he thinks the free market, not Daddy, should set money and interest rates, and wages and prices.He says the money machine Daddy operates doesn’t work!And that we’ll all be poorer!Because the dollar is declining!Ohhh!How silly.Why Daddy will just make more of them!!

I guess Dr. Paul agrees with St. Thomas Aquinas who said (I copied his words right out of a book) that money was invented for the convenience of serving as a common exchange measure of things saleable.And that, as a common measure, it ought to be stable.

Oh, does that make Daddy mad!!!I think if he had a bubble handy, and that man came back to earth, Daddy would pop him.

(Oh!Did I see a bond bubble?)

What would Daddy do if he couldn’t make bubbles?When Daddy changes the value of money, he likes to watch the rate go up and go down, the supply blow plenty and blow scarce.Stable dollars aren’t fun!!And every time money fluctuates, The Buckaneers can make money! cause they know stuff nobody else knows, like, well, when bubbles will blow.Some sillies call Daddy’s work “manipulation”—the dangerous power to create economic stress, control the money options, and suck people into risk.Well, I ask, what is a money machine for?

The key that operates the money machine’s power is in (Shhhh!)…the Monopoly!!I peeked.Daddy just pushes a button that makes book money, trillions--out of nothing!It’s magic money called Fed Fiat—and it’s elastic so it can expand and contract and boom and bust!The big bankers loan it out and it collects interest and commissions for them. Gobs!!! They call it “Assets.”

I wish I had a System. I would make a loan.Maybe a little one, to a little country. Then I would collect millions of dollars, every year, in interest.And if the little country couldn’t pay me some day, well, Congress would bail us out.And I would be a Buckaneer!

Lots of people are afraid of The System cause it eliminates things, like Competition, and it operates without any balances or checkups fromCongress! At practically no cost or risk to TheBuckaneers, Daddy whispers. Wow!

Congress was too busy back in 1913 and still is, I guess, to "coin and regulate the value" of people’s money by weighing and measuring it like the Constitooshun said.So The Buckeneers got the job.

Democracy can be messy! Daddy says. Congressmen get nervous when people start protesting in the street or calling all the time for them to fix this! or ask that! about their lost 401(k)s, wrecked pensions, devalued savings, soaring property taxes, lost jobs, lost equity . . . So Daddy tells the Congressmen he’ll do it for them… Of course he doesn't take calls, silly!

Congress really loves Daddy. They give him standing ovations, and passionate “Hurrahs!”He buys and sells national debt for them in the outdoor market.“The sky's my limit," Daddy chuckles. Isn't he cheeky?Then he floods the market with more Fed fiat, and, ooh la la, a hidden taxman, Mr. Inflation, pays the debt from the people’s purses.

Daddy can talk smart, too, even if he does talk kinda funny when he's in Congress, like, well, saying that the housing market has not swelled into a bubble (Daddy is always modest) because when it pops, the result won't be a "negative" for the economy but the disappearance of a "positive."

When Congress put The Buckaneers in charge of the System in 1913 (Congress can really be nice), Mr. Paul Warburg came all the way from his banking house in Germany just to help design it.Now The Buckaneers are richer than all the kings—of the Whole World!They are Global Monarchs (not butterflies, silly) who can make or break corporations and governments around the globe.

When The Buckaneers favor you, Daddy says, you get big rewards:Loans for a war, for pipelines, for corporate takeovers and monopolies that push out stupid little businesses for nice big Home Depots, billion dollar contracts likeBechtel's, world-size media chains. . . and sealing wax and all sorts of things. They can even pick the President. . .

The answer is not that complicated.The US defaults on treasuries held by the Fed (privately owned institution creating money from nothing) and begins to issue its own currency (rather than borrowing it into existence).

Exponential growth of debt is imperative under the global monetary system. There must be massive public borrowing in the absence of sufficient private borrowing. The debt must go on. After all, how can the interest on all this debt be paid unless that money is borrowed into existence?

The Federal Reserve doesn't want a recession, or a depression, so it needs to squandor more capital for short term gains in economic "growth indexes", such as GDP. Starve lenders, and encourage them to pursue much more risk. Essentially turning the economy into a gambling ring. Try to get consumers more indebted trading future consumption for present consumption with consumer credit This is the type of economy we have today, and had for many years. It's no coincidence that interest rates have been on the path of decline for decades. We are zero percent, and can't go any lower. If we go higher than 0 percent, like 3 percent on the Federal Funds, the economy will return to a recession. The Federal Reserve is hoping that that a economy that depends on cheap money can somehow survive, and thrive when cheap money is removed.

When one conceeds that recessions should be avoided at all costs, then you must conceed inevitably in my view, that you must continue with more, and more, and more, and more stimulus to prevent recessions, this includes bailouts. The implications of this are quite clear, easier money begots easier money, because a recession is something we should all avoid at all costs. A recession is a correction, however painful to economic imbalances in the Austrian view.

The shop teacher in our high school used to demonstrate the danger of the plunge router by a fictional account of a student who tried to hold the blade of the router and turn it on to impress his friends.

It worked, in fiction, except to release it in reality would have destroyed his fingers.

But Ms.Yellen’s hand on the blade of destruction is not fictional.

Unless Ms. Yellen solves the Fed’s problem of the destruction of the purchasing power of sound money and stops immediately the confiscation and transfer of the wealth of the nation to a banking cartel that cannot produce value, the economy is going to self destruct.

The American people, through educators such as yourself and the Tyler Durdens, are awakening to the realization that when economic freedom is destroyed, so is political freedom. The media's aim is to divert the public's attention to fake two-party partisanship while the takeover of America’s financial centerand the nation by private bankers continues.

In 1943, just before the United Kingdom’s pound sterling lost its status as the world’s reserve currency, a body of influential citizens pleaded for monetary reform; their objective was an honest National Money Systemfor England with the prerogative over the issue of money by the “community of each nation.”

The letter, signed by 32 prominent spokesmen in Great Britain, concluded:

“The issue and destruction of money by the money-lenders is not a service, but a weapon which can be and has been used to perpetuate poverty amidst abundance, which renders individuals and nations powerless to protect themselves, and which may even be perverted to serve vast designs for the complete subjugation of the human race to tyranny, exploitation and the powers of darkness and evil.”

As unemployment continues to plague our nation, Ron Paul explains:

“The Fed is not a small business or a manufacturer that creates value or increases productivity to sustain real job growth.It literally destroys value by printing more money, and distributing it through sweetheart deals to well connected banks and investment houses to prevent them from going bankrupt as they should.Instead, they survive to malinvest another day while their executives enjoy jackpot bonuses.”

America is paralleling the UK’s demise as the bankers finalize their approach to world government. It’s a path to destruction perpetrated by a flawed economic system.

Fortunately, it is going to blow up in the hands of the perpetrators, i.e., the bankers.